Local Tax Act

A corporation that is obliged to file a return concerning corporation tax under Article 74, paragraph (1) or Article 144-6, paragraph (1) of the Corporation Tax Act and to which Article 75-2, paragraph (1) of that Act applies, when paying the corporation tax levy amount calculated by taking as the tax base the corporation tax amount on the income of the computation period of the tax base of the corporation tax amount relating to that return to which that application relates, and the per capita levy amount to be paid together with it, must pay, in addition to that tax amount, an amount of delinquency charge equivalent to the amount calculated by multiplying that tax amount by a rate of 7.3 percent per annum, in accordance with the number of days in the period from the day on which two months have elapsed from the day following the last day of the computation period of the tax base of that corporation tax amount to the deadline for filing that return as extended under that paragraph.

The provisions of Article 56, paragraph (4) apply mutatis mutandis to the amount of delinquency charge referred to in the preceding paragraph. In this case, the phrase "notwithstanding the preceding paragraph, the following periods (limited to the period set out in item (i) in the case of the prefectural inhabitant tax payable by that reassessment increasing the tax made with respect to a corporation that evaded prefectural inhabitant tax by deceit or other wrongful act, and other prefectural inhabitant tax specified by Cabinet Order)" in paragraph (4) of that Article is deemed to be replaced with "the period from the day on which the tax payable by the filing of that original return was paid (or, if that day is earlier than the day on which two months have elapsed from the day following the last day of the computation period of the tax base of the corporation tax amount referred to in Article 65, paragraph (1), that day on which two months have elapsed) to the deadline for filing the return referred to in paragraph (1) of that Article".

The provisions of paragraph (3) of the preceding Article apply mutatis mutandis to the amount of delinquency charge referred to in paragraph (1). In this case, the phrase "notwithstanding the preceding paragraph, the following periods (limited to the period set out in item (i) in the case of the prefectural inhabitant tax relating to an amended return filed by a corporation that evaded prefectural inhabitant tax by deceit or other wrongful act having foreseen that a reassessment under Article 55, paragraph (1) or (3) would be made, and other prefectural inhabitant tax specified by Cabinet Order)" in paragraph (3) of that Article is deemed to be replaced with "the period from the day on which the tax payable by the filing of that original return was paid (or, if that day is earlier than the day on which two months have elapsed from the day following the last day of the computation period of the tax base of the corporation tax amount referred to in paragraph (1) of the following Article, that day on which two months have elapsed) to the deadline for filing the return referred to in paragraph (1) of the following Article".

If a taxpayer of corporate prefectural inhabitant tax has not paid in full the local government levies relating to corporate prefectural inhabitant tax by the due date for payment (where a reassessment or determination has been made under Article 55, meaning the due date for payment of the shortfall tax amount, and where the due date for payment has been extended, the extended due date for payment; the same applies hereinafter to corporate prefectural inhabitant tax), a prefectural tax collection official must issue a demand letter within 20 days after the due date for payment. However, this does not apply in the case of advance collection.

For local government levies relating to prefectural inhabitant tax for which collection has been deferred under Article 15-4, paragraph (1), notwithstanding the main clause of the preceding paragraph, a demand letter may not be issued unless they have not been paid in full within the period of the deferral of collection.

A prefecture in special circumstances may, by a Prefectural Ordinance of that prefecture, provide for a period different from the period prescribed in paragraph (1).

When a prefectural tax collection official has issued a demand letter, the official may collect a fee in accordance with the Prefectural Ordinance of the prefecture concerned.

When a person delinquent in payment of corporate prefectural inhabitant tax falls under any of the following items, a prefectural tax collection official must seize the property of the person delinquent in payment with respect to the local government levies relating to that corporate prefectural inhabitant tax.

when the person delinquent in payment has received a demand and has not paid in full, by the day on which 10 days have elapsed counting from the day on which the demand letter was issued, the local government levies relating to corporate prefectural inhabitant tax that were the subject of the demand.

when the person delinquent in payment has not paid in full the local government levies relating to corporate prefectural inhabitant tax by the due date for payment designated by the notice of advance collection.

When the preceding paragraph is applied to a secondary taxpayer or guarantor, the term "demand letter" in item (i) of that paragraph is to read "written reminder to pay".

If, by the day on which the 10 days prescribed in paragraph (1), item (i) have elapsed after the due date for payment of the local government levies relating to corporate prefectural inhabitant tax, a fact falling under any of the items of Article 13-2, paragraph (1) has arisen with respect to a person delinquent in payment who has received a demand, a prefectural tax collection official may seize that person's property immediately.

When compulsory liquidation procedures have been carried out on the property of a person delinquent in payment, a prefectural tax collection official must make a request for share distribution, with respect to the local government levies relating to the corporate prefectural inhabitant tax in arrears, to the enforcement agency (or, when making a request for share distribution of local government levies relating to corporate prefectural inhabitant tax that are the subject of a claim set out in Article 114, item (i) of the Bankruptcy Act (Act No. 75 of 2004), the court handling the bankruptcy case relating to that request for share distribution).

When a prefectural tax collection official is able to make a seizure under paragraphs (1) through (3), and property of a person delinquent in payment set out in the items of Article 86, paragraph (1) of the National Tax Collection Act has already been seized in a delinquent tax collection procedure for other local government levies or national taxes, or by a disposition governed by the rules of those delinquent tax collection procedures, the request for share distribution for that property may be made by participatory seizure.

Delinquent tax collection procedures for local government levies relating to corporate prefectural inhabitant tax, other than those provided for in the preceding paragraphs, are carried out in accordance with the rules for the delinquent tax collection procedure prescribed in the National Tax Collection Act.

Dispositions under the preceding paragraphs may also be carried out outside the area of the prefecture concerned.

If a taxpayer of corporate prefectural inhabitant tax, for the purpose of evading the execution of a delinquent tax collection procedure, conceals or damages property, disposes of it to the detriment of the prefecture, falsely increases the encumbrances on the property, or alters its current state and thereby reduces the value of the property or increases the expenses for the delinquent tax collection procedure, that person is to be punished by imprisonment for not more than three years or a fine of not more than 2,500,000 yen, or both.

The same applies where a third party in possession of the property of a taxpayer commits an act referred to in the preceding paragraph for the purpose of enabling the taxpayer to evade the execution of a delinquent tax collection procedure.

If a person, knowing the circumstances, becomes the counterparty of the taxpayer or of the third party in possession of the property in an act referred to in the preceding two paragraphs, the person who committed the violation as the counterparty is to be punished by imprisonment for not more than two years or a fine of not more than 1,500,000 yen, or both.

If the representative of a corporation, or an agent, employee or other worker has committed a violation referred to in the preceding three paragraphs in connection with the business or property of that corporation, in addition to punishing the offender, the fine prescribed in the relevant paragraph is to be imposed on that corporation.

When the preceding paragraph applies to an association or foundation that is not a corporation and has a designated representative or administrator, that representative or administrator represents that association or foundation that is not a corporation and has a designated representative or administrator in its procedural acts, and in addition, the provisions of laws and regulations on criminal proceedings in the case where a corporation is the defendant or suspect apply mutatis mutandis.

In the case of Article 68, paragraph (6), where a person violates, without justifiable grounds, an order of a prefectural tax collection official issued in accordance with the rules of the proviso to Article 72-2, paragraph (1) of the National Tax Collection Act, the person who committed the violation is to be punished by imprisonment for not more than three years or a fine of not more than 2,500,000 yen, or both.

If the representative of a corporation, or an agent, employee or other worker has committed a violation referred to in the preceding paragraph in connection with the business or property of that corporation, in addition to punishing the offender, the fine prescribed in that paragraph is to be imposed on that corporation.

If the preceding paragraph applies to an unincorporated association or foundation for which a representative or administrator has been designated, in addition to its representative or administrator representing that association or foundation in its procedural acts, the provisions of laws and regulations concerning criminal proceedings in the case where a corporation is the defendant or suspect apply mutatis mutandis.

In a case that falls under any of the following items, the person who committed the violation is to be punished by imprisonment for not more than one year or a fine of not more than 500,000 yen:

in the case referred to in Article 68, paragraph (6), when the person gives no answer, or makes a false statement, in response to questions by a prefectural tax collection official conducted in accordance with the rules of Article 141 of the National Tax Collection Act.

in the case referred to in Article 68, paragraph (6), when the person refuses, obstructs or evades the inspection by a prefectural tax collection official, conducted in accordance with the rules of Article 141 of the National Tax Collection Act, of books and documents (meaning the books and documents prescribed in that Article; the same applies in the following item) or other articles.

in the case referred to in Article 68, paragraph (6), when the person, without justifiable grounds, fails to comply with a request by a prefectural tax collection official, made in accordance with the rules of Article 141 of the National Tax Collection Act, for the presentation or submission of articles, or presents or submits books and documents or other articles (including copies thereof) containing false entries or records.

If the representative of a corporation, or an agent, employee or other worker has committed a violation referred to in the preceding paragraph in connection with the business or property of that corporation, in addition to punishing the offender, the fine prescribed in that paragraph is to be imposed on that corporation.

When the preceding paragraph applies to an association or foundation that is not a corporation and has a designated representative or administrator, that representative or administrator represents that association or foundation that is not a corporation and has a designated representative or administrator in its procedural acts, and in addition, the provisions of laws and regulations on criminal proceedings in the case where a corporation is the defendant or suspect apply mutatis mutandis.

In the case referred to in Article 68, paragraph (6), a person who makes a false statement to the prefectural governor on matters on which a statement is to be made in accordance with the rules of Article 99-2 of the National Tax Collection Act (including as applied mutatis mutandis pursuant to Article 109, paragraph (4) of that Act) is to be punished by imprisonment for not more than six months or a fine of not more than 500,000 yen.

The tax base of the interest levy is the amount of interest, etc. for which payment is to be received.

The amount of interest, etc. referred to in the preceding paragraph is calculated in the same manner as under the provisions of the Income Tax Act and other laws and regulations concerning income tax.

The tax rate of the interest levy is five percent.

The tax rate of the interest levy on interest, a distribution of proceeds, or a gain to which the provisions of Article 4-2, paragraph (9) or Article 4-3, paragraph (10) of the Act on Special Measures Concerning Taxation apply is five percent.

In addition to what is provided for in the preceding paragraph, matters necessary for the application of the provisions of that paragraph are specified by Cabinet Order.